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���������ֳ� - San Francisco - 22 Apr 2025: ���������ֳ� has assigned 'AA+' ratings to the following State of Oregon general obligation (GO) bonds:

--$246.925 million GO bonds 2025 Series E (Article XI-7) (Tax-Exempt);

--$183.430 million GO bonds 2025 Series F (Article XI-F(1)) (Tax-Exempt);

--$196.115 million GO bonds 2025 Series G (Article XI-G) (Tax-Exempt).

The bonds are expected to sell via negotiated sale on or around April 30, 2025.

The Rating Outlook is Positive.

The State of Oregon's 'AA+' Long-Term Issuer Default Rating (IDR) and GO bond ratings reflect the state's strong revenue and spending control, low liabilities and prompt actions to maintain financial flexibility during challenging revenue periods. The state's operating performance is sustained by a diverse economy with strong long-term growth prospects.

Strong financial management is critical to the rating given that the state's revenue structure is largely dependent on personal income tax (PIT), increasingly from middle- and upper-income earners. The state is exposed to voter initiatives that can have negative fiscal impacts and constitutional "kicker" provisions that limit revenue growth captured by the state.

The Positive Rating Outlook reflects ���������ֳ�'s view that Oregon appears on track to achieve and sustain material increases in gap-closing capacity, as the state maintains increased reserves in its Education Stability Fund (ESF) and Rainy Day Fund (RDF).

SECURITY

The GO bonds are direct general obligations of the State of Oregon, with the full faith and credit of the state pledged to bond repayment.

KEY RATING DRIVERS

Revenue Framework - 'aaa'

���������ֳ� expects Oregon's revenues, which are heavily dependent on PIT revenues given the lack of a sales tax, to continue to reflect the strength of its economy and exhibit growth consistent with long-term expectations for national GDP growth. The state has an unlimited legal ability to raise operating revenues as needed.

Expenditure Framework - 'aaa'

The state maintains ample expenditure flexibility with a low burden of carrying costs for long-term liabilities and the broad expense-cutting ability typical of most U.S. states. As with most states, Medicaid remains a key expense driver but one that ���������ֳ� expects to remain manageable.

Long-Term Liability Burden - 'aaa'

Combined debt and pension liabilities represent a low burden on resources, even when considering planned future debt issuances. Other post-employment benefits (OPEB) obligations are modest.

Operating Performance - 'aa'

The state's strong management of its financial operations leaves it well positioned to deal with economic downturns, although resilience remains constrained by voter-approved fiscal restraints and revenue volatility. The state has very strong gap-closing capacity, with its strong control over revenues and spending buttressed by increased dedicated reserves.

RATING SENSITIVITIES

Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade

--Revenue volatility or other fiscal issues that trigger draws on dedicated reserves to below pre-pandemic levels without a plausible plan to quickly restore them to at least 20% of average annual revenues (10% of biennial revenues).

Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade

--Sustained improvements in gap-closing capacity, including maintaining combined RDF and ESF reserves near to over 20% of average annual revenues (10% of biennial revenues).

--Structural changes to the state's voter initiative process that reduce constraints on the state's operating flexibility.

PROFILE

The state has made steady economic gains in recent years due to a more diversified economy and a growing population, with strength in the technology and manufacturing sectors. Oregon remains vulnerable to economic volatility and disruptions to international trade during recessions.

Additional Security Details

Qualifying debt covered by the Oregon School Bond Guaranty Program is secured by the state's full faith and credit obligation, on par with that of its own GO bonds. Program mechanics allow sufficient time for state funds to be made available by the treasurer to pay debt service by the debt service payment date. As a result, bonds qualifying for the program receive a rating on par with the state's GO bonds.

The state's appropriation-backed bonds are payable from monies appropriated by the state to debt repayment. The state's Department of Administrative Services (as the borrower) covenants to include a request for sufficient debt service monies in the governor's budget request for each biennium. The one-notch rating distinction from the state's IDR reflects a slightly greater repayment optionality associated with debt paid from appropriations.

Date of Relevant Committee

31-Mar-2025

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING

The principal sources of information used in the analysis are described in the Applicable Criteria.

ESG Considerations

���������ֳ� does not provide ESG relevance scores for Oregon, State of (OR) [General Government].

In cases where ���������ֳ� does not provide ESG relevance scores in connection with the credit rating of a transaction, program, instrument or issuer, ���������ֳ� will disclose any ESG factor that is a key rating driver in the key rating drivers section of the relevant rating action commentary. For more information on ���������ֳ�'s ESG Relevance Scores, visit /topics/esg/products

Additional information is available on

APPLICABLE MODELS

Numbers in parentheses accompanying applicable model(s) contain hyperlinks to criteria providing description of model(s).

• FAST Econometric API - ���������ֳ� Analytical Stress Test Model, v3.1.0 (1)

ADDITIONAL DISCLOSURES

• Solicitation Status
• Endorsement Policy

ENDORSEMENT STATUS